1. Bond Premium, Entries for Bonds Payable Transactions

   Rodgers Corporation produces and sells football equipment. On July 1, Year 1, Rodgers Corporation issued $20,400,000 of 10-year, 14% bonds at a market (effective) interest rate of 12%, receiving cash of $22,739,766. Interest on the bonds is payable semiannually on December 31 and June 30. The fiscal year of the company is the calendar year.

   Required:

   For all journal entries with a compound transaction, if an amount box does not require an entry, leave it blank.

   1. Journalize the entry to record the amount of cash proceeds from the issuance of the bonds on July 1, Year 1.

   		fill in the blank c0b738025fbaf84_2	fill in the blank c0b738025fbaf84_3
   		fill in the blank c0b738025fbaf84_5	fill in the blank c0b738025fbaf84_6
   		fill in the blank c0b738025fbaf84_8	fill in the blank c0b738025fbaf84_9

   2. Journalize the entries to record the following:

   a. The first semiannual interest payment on December 31, Year 1, and the amortization of the bond premium, using the straight-line method. Round to the nearest dollar.

   		fill in the blank 618f2cff601106f_2	fill in the blank 618f2cff601106f_3
   		fill in the blank 618f2cff601106f_5	fill in the blank 618f2cff601106f_6
   		fill in the blank 618f2cff601106f_8	fill in the blank 618f2cff601106f_9

   b. The interest payment on June 30, Year 2, and the amortization of the bond premium, using the straight-line method. Round to the nearest dollar.

   		fill in the blank 5012dbf63055001_2	fill in the blank 5012dbf63055001_3
   		fill in the blank 5012dbf63055001_5	fill in the blank 5012dbf63055001_6
   		fill in the blank 5012dbf63055001_8	fill in the blank 5012dbf63055001_9

   3. Determine the total interest expense for Year 1. Round to the nearest dollar. $fill in the blank f0efbff82fecf86_1

   4. Will the bond proceeds always be greater than the face amount of the bonds when the contract rate is greater than the market rate of interest?

   5. Compute the price of $22,739,766 received for the bonds by using Table 1, Table 2, Table 3 and Table 4. Round to the nearest dollar. Your total may vary slightly from the price given due to rounding differences.

   Present value of the face amount	$fill in the blank f0efbff82fecf86_3
   Present value of the semiannual interest payments	fill in the blank f0efbff82fecf86_4
   Price received for the bonds	$fill in the blank f0efbff82fecf86_5